Federal Single Audit – What You Need to Know

federal single audit
federal single audit

If your organization receives federal funds, then you need to be knowledgeable of federal single audit requirements. Your understanding helps to ensure compliance, accountability, and transparency of your organization.

Below, we explain the basics of a single audit. If you need more assistance, complete the form at the bottom to talk with one of our audit experts.

What is a Federal Single Audit?

A federal single audit ensures that groups that receive federal funds, like state and local governments, nonprofit organizations, and institutions of higher education, use those funds in compliance with the terms and conditions of the federal awards.

Also known as a Single Audit or Uniform Guidance Audit, a federal single audit is conducted in accordance with the Uniform Guidance, which is a set of regulations issued by the U.S. Office of Management and Budget (OMB). This office governs federal grants and cooperative agreements.

As the U.S. OMB further explains, “A single audit is intended to provide a cost-effective audit for non-federal entities in that one audit is conducted in lieu of multiple audits of individual programs.”

What are key components of a single audit?

 Below are some general terms essential to understanding federal single audits.

Schedule of Expenditures of Federal Awards (SEFA) – The SEFA provides a detailed listing of all federal awards received and expended by the auditee during the audit period. External auditors use specific criteria to determine which federal programs are considered “major” on that list and, thus, require in-depth testing.

This step is crucial because auditors concentrate their efforts on testing major programs – not all programs.

Compliance Testing – Auditors review the recipient’s records and transactions related to federal awards to assess compliance with specific laws, regulations, and award terms.

Internal Control Assessment – Auditors also evaluate the recipient’s internal controls, which are the processes and procedures in place to safeguard federal funds and ensure compliance.

Single Audit Report – At the conclusion of the audit, the external auditor issues a Single Audit Report. It includes an opinion on the financial statements and provides details on the compliance of major federal programs, along with any findings of non-compliance or questioned costs.

Corrective Action and Resolution – After receiving the report, your organization is responsible for taking corrective action to address any findings and recommendations. Quick and appropriate corrective action is essential to improve compliance and prevent future issues.

Morgan & Associates Have Experience with Single Audits

A federal single audit is a critical tool to ensure the proper use of federal funds by organizations. We’ve worked with many nonprofits and schools, so we have years of experience with requirements surrounding federal funds.

Use the form below or the chat box to contact one of our audit experts. We’d love to help your organization confidently and successfully complete the audit process.

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